NYNY Solutions

A blog entry by Seth Godin about the inherently non-commercial nature of the Internet (here) points to some interesting characteristics that marketers need to consider.

But I think Godin oversimplifies things (gasp!). Perhaps he knows this and doesn’t care, which is quite alright, it’s still a very valid point he is making about why and how the Net has become what it is today, and what we expect from it.

However, Mr. Godin is comparing the Internet to a newspaper or a TV-station, and that just doesn’t make sense. I think it’s more valid to compare the Internet to the invention of the Printing Press, Radio or TV broadcasting. There are non-commercial radio stations, non-profit magazines and publications with no advertising in it. I don’t even have to mention books - when was the last time you bought a novel with ads in it? Get the point?

In fact, with giant webshops like Amazon, wonderfully fragmented marketplaces like eBay and über-commercial Swiss Army Knives of shopping like price comparison sites, there are definetly Internet real-estate that’s every bit as commercial as anything you can point your finger at offline. 

We really only have to look at the success of AdWords, to realize that it’s not even about targeting User A (would never buy a thing) or User B (Shopoholic), instead it’s about Momentary Mindsets. 

Yesterday User A might have been a Concerned Citizen researching additives in baby food;

Today User A has calmed down and morphed into User B - dead set on finding a home-delivery subscription service for baby food.

Yesterday no ad in the world would have converted, today, any half decent offer has a good chance.

Today is the day User A clicks on those AdWords ads from somerandombabyfoodname.com.

I just wrote a description of our services to a partner who wanted to know how to describe what we do. Here’s what I wrote first:

/…/ A typical project setup that we’ve done for European Travel companies, Hosting companies, Software developers, Retail companies, Consultancy companies, etc - is something like this:

1) We identify what they want to do with their website, some sell stuff online, some use their website as a showroom, some want to attract resellers, some want to reach people with information, etc..

2) We determine how to track performance - if there are no tools in place, we will advice and assist in selecting and implementing

3) We review the website(s) - sometimes they are just not up to the task, and often they are far from optimised. We can take part both on a technical and commercial level, including e.g. Search Engine Optimisation

4) We make and execute a marketing plan for the website, combining a wide range of systems and techniques such as Search Engine Marketing, affiliate networks, viral marketing, permission marketing (e-mails), press releases, campaign-sites / localised sites, banner advertising, etc. Offline elements would also be considered if relevant/necessary. Stepping outside pure marketing - we could also work on finding regional/national partners, etc.

5) We monitor the results of the activities and make ongoing adaptions, revising targets in cooperation with the client.

- If more assistance is required than we can handle ourselves, we subcontract, anything from software and web developers, to designers and media bureaus. /…/

Well, it’s correct, and probably quite informative, but it just sounds complex. Here’s my second version:

NYNY Solutions can market your company effectively on Google and other search engines. We do all the work for you, and your programs can start and stop instantly, so there is no overhead cost and no risk.

No question about which version is more to the point. I think I just proved to myself that less is more, also in b2b.

There’s one thing that unites travel search engine (TSE) companies and Google. I wish it was the turnover. It’s not, but at least it’s the business model, and that’s something.

[pause for effect]

Both companies are selling shovels.

Business through search engine advertising currently shows very attractive ROMI figures, it’s still pretty new and fresh and helps managers perform Management - “We must be on Google”. It’s an easy phrase to remember, and it sounds cool in meetings.

So, it’s the Klondyke gold rush all over again, and the gold-diggers are lining up.

Googles advertisers are gold-diggers. So is a TSE’s. Some prove very successful, some moderately so, and some absolutely not at all.

And yet we’re selling the shovels for the same price to all of them. Or in the case of Google - selling the shovels to whoever pays the most. Regardless of the details, we really don’t care how good each individual buyer is at digging gold. we should, however, care a great deal about how good the buyer collective is at digging gold, because we live in symbiosis.

And that’s the thing of the thing. Although we are depending on our buyers’ success, we still don’t move in and try to be extra nice to a particular client. Why? Becaue we’re shovel peddlers and this is what differentiates us from being consultant gold-diggers, or rent-a-gold-digger’s. This is what we must not sway from, if we want to be successful in the long run.

A gold-digger should be able to make rational assumptions about the market space, and regard our service as neutral and unbiased - any gold-digger’s money is worth as much as the next one’s, and everyone get’s the same kind of shovel and the same kind of warranty. Without this, we are invevitably starting to take sides, and we are no longer selling shovels, but helping to dig.

So how do we figure out if the shovel-peddler & gold-digger setup is going to be a sustainable setup ?

First, there must actually be enough gold around, for enough gold-diggers to live and tell their success stories. As long as the barrier of entry is low, and gold is abundant, gold-diggers with pocket calculators will do their math and figure out up to what point it makes sense to enter the shovel store. We will have more and more gold-diggers lining up to buy shovels.

Second, there must be enough shovels (if you haven’t figured it out yet, a shovel in this analogy is a click or a visit to a website - but, nota bene, not orders. A shovel is not gold, it’s what you dig with to find gold) and the shovels must be effective tools for gold-digging.

For a TSE, the analysis consists of trying to determine conversion rates and profit margins at airlines, online travel agencies, hotel chains, and other types of companies (gold-diggers). A blinding flash of the obvious is we need to have a solid idea of at what price our customers break-even when buying an incremental visit to their sites. We need to estimate the total market size and growth potential, and figure out the quality of our traffic. We can’t do much about the market, but we can focus on improving both quality and volume of traffic.

We need to be skilled gold-diggers but dedicated to staying in the store.

Finally finished the last pages of The Long Tail, by Chris Anderson. I’ve been harrassed for months for not finishing it by a Hjalmar Gislason, a good friend who told me ages ago to read it.

In the book, Anderson explores the underlying mechanisms causing a shift from “hits” to “niches”. E.g. where a physical record-store may display a few thousand different CD’s, an online store like Amazon may offer hundreds of thousands, and a digital distribution system like iTunes may offer virtually any song ever recorded, still profitable.

The abundance of choice, ease of finding, sorting and getting peer-to-peer recommendations - are all factors that dramatically steer consumer behaviour away from mainstream hits and deeper into different niches.

I don’t expect to attend a single conference the next 2 years without seeing at least one slide with “long-tail” jammed into it somewhere. It’s the buzzword of the day, for sure.